Monday, January 15, 2007

Will KDDI's new GPS phones be a blessing or a curse?


A collective sigh of relief from parents in Japan might just be heard as KDDI launches their 2 new phones which allow parents to know their childrens' exact locations. This follows after Japan's other big mobile operators who have already started offering similar services.

The handsets, among three the company unveiled, can inform parents of their children's whereabouts every five minutes. While this might be a blessing for the over-concerned parent, the children might lament that this would eventually lead to a total loss of privacy. What could be further implications of the market with the introduction of these 2 new phones?

For one, the mobile operators will have increased rivalry due to different demographics turning their own way. Parents will boost KDDI's sales as they would want that extra security in knowing their children's whereabouts. The company has had "constant demand" for children's handsets, said Hiroshi Arai, a spokesman for the company. "There are parents who want their children to have a handset because they are concerned about safety."

On the flipside, children who buy their own phones would avoid KDDI for the reason of the loss of privacy and could result in KDDI's competitors to increase their own sales. It could turn out to be a double-edged sword for KDDI. Also, since the three biggest mobile operators in Japan offers phones with GPS, smaller operators night benefit from this trend. Also, the recently introduced number portability policy will increase rivalry and this GPS phone might just be good news for smaller operators, that is if they play their cards right.

A social consequence of this GPS-enabled handset trend might be the total reluctance to carry a phone around everywhere they go. In this case, the high-tech GPS phone will be deemed useless and that could create even more cause for worry for parents as their children would now be not contactable at all.

Those are just examples of the market and social impacts that GPS-enabled phones might have in Japan. Perhaps in the future, all phones will have GPS and there may be more implications then, for better or for worse. But till that time comes, I can safely speculate that KDDI won't have the support of rebel children who treasure their freedom. What do you think?